Strike off companies

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

20 June 2014 Whether a Company which has been striked off for last 8 years for non filing of
annual filings and have some assets (by fault) gets liquidated by the Govt.
Whether revival is an option.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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20 June 2014 The company can seek for 'restoration' u/s 560(6) of the Companies Act,1956 if they so wish ,since rules under chapter XVIII of Companies Act,2013 is not notified yet.

Querist : Anonymous

Querist : Anonymous (Querist)

20 June 2014 Thanks Sir for Reply!
Sir there are two terms used in the Section please clarify the Meaning of Those:
1) The Company shall stand disolved
2) 560 (4) It shall be send to the liquidators.

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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25 July 2025 Great questions! You're referring to the provisions under **Section 560 of the Companies Act, 1956**, which dealt with **strike off and dissolution of defunct companies**. Let’s walk through your queries step-by-step for full clarity:

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## ✅ Background: Strike-Off under Section 560 (Companies Act, 1956)

* Section **560(1)–(5)** allowed the **Registrar of Companies (ROC)** to strike off a company that hadn't filed annual returns or was no longer in operation.
* Under **560(6)**, an **aggrieved party** (like directors, creditors, shareholders) could apply to the **High Court** for **restoration** of the company within a prescribed period.

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## 🟨 Your Situation

* Company was **struck off 8 years ago**
* Has **unrealized assets**, possibly land, investments, or balances
* You want to know whether **revival is still possible**, and what the terms "dissolved" and "sent to liquidator" mean

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## 1️⃣ Term: “The company shall stand dissolved”

### 📌 Meaning:

* As per **Section 560(5)**:

> “On publication in the Official Gazette... the company shall stand dissolved.”

* This means the company **ceases to exist legally**, just like after a formal winding-up.

* However, this **does NOT mean the assets disappear** — they remain vested and **can be dealt with during restoration or liquidation**.

* Despite dissolution, the company can still be **restored under Section 560(6)** if:

* An application is made to the **High Court/NCLT**,
* Within the prescribed time (originally 20 years; now reduced to **20 years → 3 years** under the Companies Act, 2013 — but transitional cases still allowed longer).

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## 2️⃣ Term: “Shall be sent to the liquidators” (Section 560(4))

### 📌 Meaning:

* If the ROC learns during strike-off that the company **has assets** or there’s a **winding-up petition pending**, he **cannot strike it off directly**.
* Instead, ROC must **refer the matter to a liquidator** (under winding up provisions), so the **assets can be realized** and **creditors paid**.

This clause ensures that **no company with assets escapes liquidation responsibilities by being struck off silently**.

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## 🟢 Is **Restoration an Option** After 8 Years?

### ✅ Yes, restoration is possible **even after many years**, *if you can show sufficient cause*.

### You should:

* File a petition for **revival under Section 252 of the Companies Act, 2013** (which replaced Sec 560(6)).
* Petition must be filed with the **National Company Law Tribunal (NCLT)**.
* You must show:

* The company was carrying on business or had assets.
* There’s a genuine need to restore (like realization of assets).

📌 Courts have **restored companies even after long delays** — especially when **undisclosed or mistakenly left assets** are involved.

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## ✅ Action Plan for You:

| Step | Description |
| ---- | ------------------------------------------------------------------------------------------- |
| 1. | **Gather documents** — proof of company name, strike-off date, asset records |
| 2. | **Engage a Company Secretary or Lawyer** experienced with **NCLT matters** |
| 3. | **File a petition under Sec 252(3)** of the Companies Act, 2013 for restoration |
| 4. | If successful, ROC will restore company status to "Active" and you can deal with the assets |

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## 📝 Example Grounds for Restoration:

* Company owned land that was not sold or transferred before strike-off.
* Company had bank balances or investments.
* Assets were discovered **after strike-off** due to accounting error or inheritance.

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## 📘 Summary

| Term | Meaning |
| ------------------------------- | ---------------------------------------------------------- |
| "Company shall stand dissolved" | Legally ceases to exist, but assets still vest |
| "Sent to liquidator" | ROC sends company for formal liquidation if it has assets |
| Restoration | Yes, possible under **Section 252** of Companies Act, 2013 |

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Let me know if you want a **template for the NCLT petition** or help assessing if your case qualifies for restoration.

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